Profits or gains of a capital nature are determined on the basis of the period that would have been used under Part XI of that Act instead of applying the special rules in Part X of the ITAA 1936. [subsection 559A(5)]
This rule ensures that any choice in relation to a FIF will not:
- refresh the cost base of assets that are held by the FIF;
- change the time of acquisition of an asset held by a FIF; or
- impact on the events that result in a capital gain being ignored.